"We are upgrading PPL to Buy from Hold based on the free option that investors get if the company is able to spin-off its unregulated supply business," analyst Paul B. Fremont said. "Management has forecasted PPL's unregulated generation to be break-even beginning in 2015 and we believe the market is currently ascribing no value to these assets."

Despite the upgrade, the firm trimmed FY 2014 EPS form $2.15 to $2.10.

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